7df52-wp 0762 otc market in central and eastern europe will grow in 2009 despite the global...

8/2/2019 7df52-Wp 0762 OTC Market in Central and Eastern Europe Will Grow in 2009 Despite the Global Financial Crisis Aug

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P U B L I C A T I O N SPMR

OTC market in Central and

Eastern Europe will growin 2009 despite the global

fnancial crisis

Agnieszka Stawarska

Source: Report OTC market in Central and Eastern Europe 2009.

Comparative analysis and development forecasts for 2009-2011

August 2009

www.ceepharma.com

FREE ARTICLE


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www.ceepharma.com

OTC market in Central and Eastern Europe will grow in 2009 despite the global fnancial crisis

In 2008 the OTC product market in Central and Eastern Europe developed by

around 26%, to 9.2bn. In 2009 this market in the region will grow by around 8%,

according to our latest report entitled OTC market in Central and Eastern Europe 2009.

Comparative analysis and development forecasts for 2009-2011.

8% OTC market growth in 2009

In the last few years the economies of the Central and Eastern European (CEE) countries

(Russia, Poland, Ukraine, Bulgaria, Romania, Hungary, the Czech Republic, Slovakia, Slovenia

and Croatia) expanded very dramatically. The favourable economic situation, combined with

increases in wages and burgeoning afuence in the countries in question, along with changing

lifestyles which prompt people to take better care of their health and appearance, accelerated

the growth of the OTC market in Central and Eastern Europe. In 2008 it grew by 26% and was

worth 9.2bn, according to our estimates. The current global nancial crisis will result in a

reduction in demand for OTC products, as people try to limit their spending on products which

they can do without, and in the pharmaceutical industry this means spending less on dietary

supplements and OTC drugs. In some CEE countries, such as Ukraine, negative growth may

even be seen on the OTC product market. However, we forecast that, despite this, the overall

OTC product market in the region will grow by around 8% to approximately 10bn in 2009.

This is mainly because, in Russia, the largest market of the region, the OTC product market

will see a positive growth rate of several percent this year. In the rst half of 2009, the market

in Russia grew by around 28% in rouble terms. In euro terms the growth rate was 6%, and in

dollar terms there was an 8% reduction1. However, such gures reect unfavourable exchange

rates and not, therefore, real market growth. This shows, that despite the global nancial

crisis, Russians are still buying OTC products very of ten and that the market should also grow

rapidly in the next few months.

Agnieszka Stawarska,

Pharmaceutical Market Analyst

1 Pharmexpert data.


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www.ceepharma.com


Russia predominates in the region

Last year, almost half of OTC market value in the region was accounted for by Russia,

according to our estimates. Poland was the second largest OTC market in the region, with a

share as a proportion of total sales in excess of 22%. Ukraine had a share of around 10%,

whereas for the Czech Republic the gure uctuated around 6%.

Regulations pertaining to distribution notstandardised

One of the factors which inuences growth on the OTC product market is the nature of

the regulations pertaining to the distribution of such products in individual countries. Although

in some countries non-pharmacy and online sales of OTC drugs is allowed, pharmacies will

remain the main channel for sales of OTC medicines, because there is a preference among

consumers of OTCs to purchase such products at outlets at which they can also obtain a

pharmacists advice. In addition, the online sales channels of many groups of drugs may

not become widely used, because of several factors: lack of trust in the channel in question,

consumer habits and, nally, the low number of internet users in some countries.

In none of the countries of the region are there restrictions on the sale of dietary

supplements in general stores, which are always subject to laws on foodstuffs, rather than

those pertaining to pharmaceuticals.

Legislation which regulates non-pharmacy sales of OTC drugs is, however, more

restrictive, and the regulations differ from one country to the next. In none of the CEE countries

analysed is the sale of all OTC drugs permitted in general stores. The most liberal law exists in

Hungary, where some 390 brands of OTC drugs may be sold in places other than pharmacies.

Source: Report OTC market in Central and Eastern Europe 2009.Comparative analysis and development forecasts for 2009-2011,PMR Publications, a division of PMR, 2009 www.pmrpublications.com

Share of individual OTC markets as a proportion of total OTC market in CEE,2008

Russia

45.5%

Poland

22.1%

Ukraine

9.6%

Czech Republic

5.9%

Romania

4.4%

Bulgaria

4.3%

Hungary

3.4%Slovakia

2.4%

Croatia

1.9%

Slovenia

0.5%

OTC market in CEE: 9.2bn.


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Most CEE countries also do not permit the online sale of drugs. The most liberalised

countries are Poland and the Czech Republic, whose governments have decided to regulate

this issue and have approved the online sale of all OTC drugs. In Poland the online sale of OTC

drugs was approved on 1 May 2007, and in the Czech Republic a law permitting the online

sale of medicines came into force in January 2008.

The article is based on the report OTC market in Central and Eastern Europe 2009.

Comparative analysis and development forecasts for 2009-2011 published by PMR

Publications in August 2009.

Methodology notes:

The forecasts for the years 2009-2011 were prepared taking into account the average

2008 exchange rate of the euro against the local currencies, as this reects the real growth of

the market. The historical data are based on annual exchange rates (euro to local currency).

The value for the OTC product market is for 10 countries. For Russia, Ukraine, Poland,

Romania, Bulgaria, Hungary and the Czech Republic OTC drug and dietary supplement market

value is computed. The non-pharmacy dietary supplement market in Russia is excluded, as it

is not well-monitored and, therefore, impossible to estimate with precision. For Croatia and

Slovenia only OTC drugs are included. For Slovakia the overall OTC market is included.


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